iSECUREtrac Corp. Omaha, NE 68137 EMPLOYMENT AGREEMENT
EXHIBIT
10.26
0000
Xx. 000xx
Xxxxxx
Xxxxx,
XX 00000
THIS
EMPLOYMENT AGREEMENT is made by and between iSECUREtrac Corp. (“iST”), on behalf
of itself, and iST Services, Inc. and Lincoln
X. Xxxx
(“Employee”) on the date this Employment Agreement is signed by Employee
(“Effective Date”).
iST
and
Employee desire to enter into this Employment Agreement to clarify and formalize
the understanding each has of the employment relationship.
Employment
with iST is freely and voluntarily entered into and Employee is free to resign
at any time, with or without cause. Similarly, iST may terminate the employment
relationship at will at any time, with or without cause.
During
the course of employment with iST, Employee has access to information deemed
confidential by iST, whether or not such information is proprietary to iST,
and
both iST and Employee are obligated to safeguard such information. A
confidentiality agreement, as contained herein, is necessary to assure adherence
to iST’s non-disclosure policies and agreements between iST and other parties.
Employee
may be asked to develop, improve or modify products and processes for iST.
The
ownership of work products provision in this Employment Agreement assures iST’s
ownership in any work in which Employee may become engaged which is related
to
iST’s business.
Upon
termination of the employment relationship, it behooves iST to ensure the
absence of unfair competition by obtaining Employee’s agreement not to compete
with iST, directly or indirectly, for a period of one year.
THEREFORE,
in consideration of Employee’s employment with iST, the remuneration now and
hereafter paid to Employee by iST and/or other good and valuable consideration,
Employee and iST agree as follows:
1.0 DEFINITIONS
1.1 “iST”
as
used herein shall include iSECUREtrac Corp., iST Services, Inc. and any
corporation hereinafter acquired and/or majority owned by iSECUREtrac
Corp.
1.2 “Confidential
Information” shall mean all information related to iST’s business affairs,
services, products, research and development which is not generally available
from public sources, whether or not such information is in written or tangible
form. Such information includes, without limitation, Work Products, trade
secrets, financial information, marketing and sales plans, strategic business
plans, software and related documentation, hardware specifications and drawings,
designs and technical documentation, price lists, manufacturing information,
compensation plans, any information related to an iST customer which has been
designated as confidential by such customer and any information pertaining
to
iST employees deemed confidential by either the employee or iST.
1.3
“Work
Products” shall mean any and all products, processes and materials developed and
produced by Employee for iST, including, without limitation, drawings, plans,
proposals, documentation, financial projections, charts, product prototypes,
software, specifications, cost estimates, letters, notes, manuals, notebooks,
reports, presentations and the like and shall specifically include inventions,
discoveries, improvements or enhancements related to iST’s business or products
that Employee may develop or conceive and reduce to practice while employed
at
iST or within six (6) months after the termination of such employment, at any
time, alone or with others, with or without the use of iST’s resources,
regardless of whether patent, copyright or trade secret law may technically
be
applied.
2.0 EMPLOYMENT
2.1 Employee
hereby accepts employment with iST on the terms and conditions stated in this
agreement and as set forth in the offer letter to Employee from iSECUREtrac
Corp. (the “Offer Letter.”) Although iST may originally hire Employee to fill a
specific position and will initially provide Employee specific compensation
and
benefits, iST shall have the right, at any time and within its sole discretion,
to reassign Employee to any other position suitable to Employee’s skills,
experience, education and performance and to alter Employee’s compensation and
benefits. iST’s provision of compensation and benefits to Employee shall be
subject to the terms and conditions of iST’s compensation and benefits plans,
policies or practices as the same may be amended or revoked from time to time.
Any position within iST shall have such responsibilities as may be described
in
an appropriate position description and/or assigned by the incumbent’s
supervisor. Employee agrees to perform the duties assigned to him/her to the
best of his/her ability in a diligent, trustworthy, businesslike, and efficient
manner for the purposes of advancing the business of iST and, to this end,
will
devote his/her full time and attention to the business of iST. Furthermore,
Employee shall comply with iST’s rules and regulations as may be set forth in
iST’s Employee Handbook, or similar document.
2.2 Employee’s
employment hereunder shall be at will. Either Employee or iST may, for any
reason or for no reason at all, at any time, terminate employment with iST
upon
two week’s prior written notice.
2.3
Severance
Benefits.
In the
event Employee’s employment is terminated (a) by ISECURETRAC without Cause,
subject to the conditions stated herein, ISECURETRAC shall: (i) pay Employee
an
amount equal to three (3) months of Employee’s salary in accordance with the
Company’s standard payroll procedures, minus all applicable taxes, withholding
and lawful deductions, plus any accrued vacation; and (ii) Notwithstanding
the
foregoing, ISECURETRAC’s obligation to provide the severance benefits hereunder
is expressly conditioned upon the Employee’s ongoing compliance with the
Confidentiality and Non-Solicitation provisions of this Agreement, and upon
Employee’s execution of a release of all claims against ISECURETRAC, including,
but not limited to those related to his employment and/or termination (other
than obligations owed under this subsection and/or claims related solely to
Employee’s status as a shareholder.) Employee agrees that severance benefits as
provided herein shall be the sole consideration to which he is entitled in
the
event of the termination of his employment without Cause, that severance will
not be paid in the event of termination with Cause or resignation without Good
Reason, and Employee expressly waives and relinquishes any claim to other or
further consideration.
For
purposes of this Agreement, "Cause" shall consist of (a) any act of dishonesty
or fraud by Employee in connection with his duties or intended to result in
his
substantial personal enrichment; (b) Employee’s conviction or a plea of nolo
contendre to a crime that the Board reasonably believes has had or will have
a
materially detrimental effect on the ISECURETRAC’s business or reputation,
provided, traffic infractions shall not be deemed a crime; (c) Employee's
material breach of this Agreement or failure to properly perform his job duties,
if such breach or failures are not promptly cured within 10 days after written
notice is provided to Employee; (d) Employee’s gross negligence or willful
misconduct in the performance of his duties, which includes, but is not limited
to conduct that is inconsistent with ISECURETRAC’s then-established practices or
places ISECURETRAC at risk of liability; (e) Employee’s failure to abide by the
lawful policies and directives of the Board; (f) Employee’s absence from work
for a period in excess of ninety (90) days in any twelve month period regardless
of the reason, including disability; (g) action or conduct determined by the
Board acting in reasonable good faith to be of material detriment to
ISECURETRAC; or (h) Employee’s death.
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2.4 Employee’s
violation of any rules or regulations stated in the iST Employee Handbook may
be
cause for his/her immediate employment termination, without
prior
written notice.
2.5
Employee
agrees that during his/her employment with iST, Employee will not engage in
any
other employment, occupation, consulting, counseling or other activity relating
to the provision of GPS tracking products and services to criminal justice
agencies or which would interfere with Employee’s ability to devote
substantially all of Employee’s working time to iST’s business. Employee also
agrees he/she will not undertake the planning or organization of any business
activity competitive with iST or the work Employee performs for iST during
his/her employment.
3.0 CONFIDENTIALITY
3.1 Employee
acknowledges
and agrees that, as a consequence of his/her association with iST, he/she has
or
will have access to or knowledge of confidential and proprietary data concerning
iST which is not readily available to the public. Employee
hereby agrees to safeguard and protect Confidential Information by all
reasonable and necessary means, observe and be bound by the provisions of this
Employment Agreement and observe and adhere to all rules and policies which
iST
may announce from time to time to protect its Confidential
Information.
3.2 Employee
agrees that all
Confidential Information, regardless of how it is compiled, listed, stored
or
kept, shall be the exclusive property of iST. Employee
hereby agrees, both during the period of employment with iST and thereafter,
that Employee shall not disclose Confidential Information to any person or
permit any person to obtain Confidential Information, except as specifically
authorized in writing by iST or as required by Employee’s duties to
iST.
3.3 Employee
shall not disclose Confidential Information to any person who has not executed
an appropriate non-disclosure agreement with iST.
3.4 Upon
termination of employment, for any reason, Employee shall immediately return
Confidential Information then in his/her possession to iST and keep no copies
thereof without the express written permission of iST.
4.0 OWNERSHIP
4.1 iST
shall
be the sole and exclusive owner of any and all Work Products. All Work Products
shall be considered as work made for hire by Employee for iST. To the extent
that iST needs to protect its ownership in any Work Product(s), Employee shall
assign and transfer to iST, without further consideration, any and all
proprietary rights in such Work Product(s) and to execute and deliver all
documents and do all acts necessary to secure to iST, its successors, assigns
or
nominees, the entire right, title and interest in and to such Work Products,
including applications for and/or Letters of Patent of the United States and
other countries.
4.2 Notwithstanding
Section 4.1 or any provision of this Employment Agreement to the contrary,
if
Employee is found, by a court, administrative body or other adjudicatory
authority, to have a proprietary interest in any Work Product and iST’s interest
or claim to an interest therein is unenforceable, Employee hereby grants iST
a
perpetual, royalty-free license to use such Work Product.
5.0 NON-SOLICITATION
5.1
For
the
purpose of protecting iST’s legitimate interest in its Confidential Information
(as defined in Section 3 hereof) and customer goodwill, for a period of twelve
(12) months following Employee’s separation from iST, Employee will not, either
for Employee’s benefit or the benefit of any other individual or entity, either
directly or indirectly, call on, solicit, canvass, induce, influence or assist
any of iST’s clients or customers with whom Employee had personal contact or
actually did business during the term of his/her employment or any employee
of
iST to engage in any business, contact or solicitation that would be in
competition with iST.
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5.2 Employee
agrees that iST is engaged in a highly competitive business providing GPS
tracking products and services to criminal justice agencies throughout the
United States of America, Canada and the United Kingdom for tracking and
monitoring persons on pre-trial release, probation or parole (the “iST
Marketplace”), and that the Confidential Information and knowledge of iST’s
business techniques, contacts, and programs are crucial to enable it to compete
in the markets in the iST Marketplace.
5.3 Employee
acknowledges that iST has invested large amounts of time and money in its
research and development, development of business techniques, employee training
and development of proprietary and Confidential Information, which if divulged
to or used by competing entities would result in irreparable injury to iST.
Employee
agrees that money damages alone will not adequately compensate iST for breach
of
the covenant not to solicit and the provisions of this Employment Agreement
pertaining to Confidential Information and Work Product and, therefore, in
the
event of the breach or threatened breach of any such covenant or provision,
in
addition to all other remedies available at law, in equity or otherwise, without
posting bond, iST shall be entitled to injunctive relief compelling specific
performance of (or other compliance with) the terms thereof.
5.4 Employee
acknowledges and agrees that the restriction placed upon him/her in paragraph
5.1 above is (i) reasonable and necessary to protect the legitimate business
interests of iST; and (ii) will not unreasonably impede him/her from seeking
and
obtaining gainful employment in the event of his/her termination of employment
with iST.
5.5 In
the
event paragraph 5.1 above is held to be, in any respect, an unreasonable
restriction upon Employee, the Court so holding may reduce the territory and
period of time to which the restriction pertains or effect any other change
to
the extent necessary to render paragraph 5.1 enforceable and without effecting
the validity and enforceability of the remainder of this Employment
Agreement.
6.0 PRIOR
EMPLOYMENT
Employee
hereby represents and warrants that the execution of this Employment Agreement
and the performance of his/her duties and obligations hereunder will not breach
or be in conflict with any other agreement to which he/she is a party or by
which he/she is bound, and that he/she is not now subject to any covenant
against competition or similar covenant which would affect the performance
of
his/her duties hereunder. Employee acknowledges that a breach of said
representation and warranty may be cause for immediate employment termination,
without
prior
written notice, and, furthermore, Employee shall be responsible for and
indemnify iST and hold it harmless from, any claims, losses, damages, costs
or
expenses, including attorney’s fees, resulting from such a breach.
7.0 RETURN
OF iST MATERIALS AND PROPERTY UPON TERMINATION
Employee
hereby agrees that upon Employee’s termination of employment with iST, for any
reason, Employee shall immediately turn over to iST all Work Products and all
Confidential Information in tangible form which are then in his/her possession
and keep no copies thereof. Furthermore, Employee shall return all other iST
property, then in the possession of Employee, to iST upon termination, unless
a
longer retention is specifically allowed, in writing, by iST.
8.0 GENERAL
TERMS
8.1 Nothing
contained in this Employment Agreement shall be construed or deemed to confer
any right with respect to continuance of employment by iST for a specific
duration or to modify in any way the employment at will relationship between
Employee and iST.
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8.2 This
Employment Agreement is the complete and exclusive agreement between Employee
and iST concerning the subject matter hereof and supersedes any and all oral
or
written agreements regarding such subject matter. Any provision in any employee
handbook or statement of employment policies (“Employee Handbook”) shall not
affect this Employment Agreement. No statement in the Employee Handbook shall
confer any right of employment upon Employee or in any way alter the
employment-at-will nature of the employment relationship between iST and
Employee.
8.3 If
any
severable provision of this Employment Agreement is held to be invalid or
unenforceable by any judgment of a court of competent jurisdiction, the
remainder of this Employment Agreement shall not be affected by such judgment,
and the Employment Agreement shall be carried out as nearly as possible
according to the original terms and intent.
8.4 The
waiver by either party of a breach of any provision of this Employment Agreement
by the other party shall not operate or be construed as a waiver of any
subsequent breach or violation thereof.
8.5 Employee
acknowledges that he/she has completely read this Employment Agreement,
understands its provisions and freely signs below, intending to be bound
hereby.
8.6 This
Employment Agreement may not be altered except by an agreement in writing,
duly
executed by iST and Employee.
8.7 This
Employment Agreement shall be deemed to have been executed in and shall be
construed in accordance with the laws of the State of Nebraska (without
giving effect to its conflicts of law principles).
8.8 iST
and
Employee hereby acknowledge and agree that the sole and exclusive jurisdiction
and venue for all actions shall be the State or Federal courts located in
Nebraska and both parties hereby consent to such jurisdiction and
venue.
8.9 The
rights and obligations of iST under this Employment Agreement shall inure to
the
benefit of and shall be binding upon the successors and assigns of iST. This
Employment Agreement is binding upon Employee and his/her heirs, executors,
assigns and administrators of his/her estate and property.
8.10 iST
may
assign this Employment Agreement by providing Employee notice of iST’s decision
to do so. Employee may not assign or transfer to others the obligation to
perform Employee’s duties hereunder.
8.11 This
Employment Agreement shall terminate on Employee’s termination of employment
from iST; provided, however, obligations
and provisions of this Employment Agreement that, by their express terms or
otherwise, require performance or compliance by one or both parties hereto
after
termination of this Employment Agreement, including, but not limited to,
obligations to return property, confidentiality of information, covenants not
to
solicit, the binding nature of this Employment Agreement upon the parties,
successors, assigns, heirs, executors and administrators, the government and
construction of this Employment Agreement, and the invalidity or
non-enforceability of provisions of this Employment Agreement, shall survive
termination of the Employment Agreement.
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IN
WITNESS WHEREOF, Employee and iST have executed this Employment Agreement
effective as of the Effective Date.
|
AGREED
AND ACCEPTED:
|
|||
| EMPLOYEE: |
ISECURETRAC CORP. for and on behalf of
itself and iST Services Corp.
(“iST”)
|
||
| Signature: /s/ Lincoln Xxxx | /s/ Xxxxx X. Xxxxxx | ||
|
|
Xxxxx X. Xxxxxx |
||
| Address: Personal Residence | President & Chief Executive Officer | ||
| Date: December 6, 2007 | Date: December 3, 2007 |
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December
6, 2007
Lincoln
X. Xxxx
Dear
Lincoln:
On
behalf
of ISECURETRAC Corporation, we are pleased to extend this formal offer of
employment for the position of Vice President of Finance. This position will
report to Xxxxx Xxxxxx, President and Chief Executive Officer. In this capacity,
your semi-monthly rate of pay will be $6,666.67, if annualized equates to
$160,000. Your start date will be Wednesday, January 9, 2008. New employee
orientation will begin at 8:30am on your first day.
Your
first paycheck will be issued on February 1st
for the
period of January 7th
through
January 15th
. All
ISECURETRAC employees are paid on a semi-monthly basis on the 1st
and
16th
of each
month. Should the 1st
or
16th
fall on
a weekend or holiday, all employees receive their pay the Friday
before.
ISECURETRAC
will also pay you a pre-tax lump sum bonus in the amount of $10,000 on February
1, 2008. In the event that you voluntarily leave your employment with
ISECURETRAC without good reason prior to completing twelve (12) full months
of
service with ISECURETRAC, you agree to reimburse ISECURETRAC for the bonus.
The
bonus will be paid in accordance with standard payroll procedures, minus all
applicable taxes, withholding and lawful deductions.
Upon
commencing your employment with iSECUREtrac, we will recommend to the Board
of
Directors that you receive 50,000 options of ISECURETRAC’s common stock under
the terms of our 2006 Omnibus Equity Incentive Plan. Additionally, you will
be
extended all of ISECURETRAC’s standard benefits commencing the first of the
month following 30 days of hire, except you will accrue 3 weeks of vacation.
In
addition to your base salary, you are eligible for an annual performance based
bonus. Your 2008 bonus target is 20% of your annual salary with a guaranteed
amount of $10,000.00 for 2008. Bonuses will be paid annually based on your
individual performance and the company’s financial goals in the quarter
immediately after the end of the calendar year. Performance goals will be
determined by the company in its sole discretion.
Please
be
informed that this offer is contingent upon successful re-activation of your
CPA
certification, successful completion of a ninety (90) day orientation period,
acceptable results and findings from a mandatory company drug test, criminal
background investigation, and credit and reference checks.
iSECUREtrac
will pay for required continuing professional education (CPE) programs for
your
re-activation and to maintain your CPA certification.
Employment
with ISECURETRAC Corp. is considered “at will,” meaning that employment with
ISECURETRAC, Corp is voluntarily entered into and the employee is free to resign
at will, at any time, with or without cause. Similarly, the employer may
terminate the employment relationship at will, at any time, with or without
cause.
We
look
forward to hearing from you about this offer. Please indicate your acceptance
of
our offer by signing below and returning one copy of the letter, with your
original signature. Also, please find the enclosed employment agreement for
your
review, execution and return with your offer letter. Should you choose to accept
our offer of employment you will need to required identification with you on
your first day of employment to verify that you are legally eligible for
employment in the United States.
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|
Sincerely,
|
|||
| /s/ Xxxxx X. Xxxxxx | /s/ Xxxxx Xxxxxxxxx | ||
|
Xxxxx X. Xxxxxx |
Xxxxx Xxxxxxxxx |
||
| President and Chief Executive Officer | Human Resources Manager | ||
| Signature: /s/ Lincoln Xxxx | Date: December 6, 2007 |
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